A Medical Device Daily

Paragon Intellectual Properties (ParagonIP; Charleston, West Virginia), the holding company for six medical device subsidiaries, said it has obtained initial commitments of $15 million in funding.

It said the investments come primarily from private investors in West Virginia in addition to equity from two “major medical device manufacturers.” Paragon said that the funding will enable it to obtain the engineering talent and infrastructure to “optimize” and commercialize two of its therapies for minimally invasive treatments for cardiovascular disease.

The funding “will allow ParagonIP to accelerate its mission of giving hope to patients with complex medical conditions through a pioneering device development model,” said Mark Bates, MD, company founder and CEO.

ParagonIP business operations will remain in Charleston. Its R&D team, headed by Chief Science Officer Kent Stalker, is opening a new facility in Carlsbad, California.

ParagonIP said its focus has been the acquisition and re-design of the Biflex bistable stent, which it calls “the world’s first balloon-expandable crush-resistant stent.” The Biflex system, it said, allows for delivery of a crush-resistant nickel-titanium stent with a balloon catheter, enabling accurate stent placement and the reduction of one to two procedural steps.

Its stent subsidiary, Biflex Hybrid Stent Systems , will initiate clinical trials on the Biflex stent in 2007, it said. Its Protection Solution subsidiary has developed technology for the minimally invasive treatment of renal artery disease and peripheral arterial disease.

ParagonIP was founded in 2004 as an incubator of some of Bates’ pending or issued patents. The original ParagonIP companies included Global Stem Cell Solutions, Nanotech Catheter Solutions, Renal Protection Solutions, Spinal Cord Injury Solutions and Temporary Intravascular Drug Delivery Systems. In 2005, ParagonIP formed Biflex Hybrid Stent Systems to acquire the Biflex technology.

Inovio Biomedical (San Diego), a developer of electroporation technology to deliver drugs and nucleic acids, reported the sale by its majority-owned subsidiary Inovio Asia (Republic of Singapore), of 2,201,644 shares of Inovio Asia at $2.43 a share, for gross cash proceeds of $5.35 million.

The shares of Inovio Asia will be exchanged for shares of common stock and warrants to purchase 770,573 shares of common stock of Inovio Bio no later than three months from the closing date and may be exchanged earlier upon the occurrence of certain events.

Separately, Inovio Bio completed the sale, directly to investors based in Singapore, of 4,074,067 shares of the common stock of Inovio Bio at $2.43 per share and warrants to purchase 1,425,919 shares of common stock of Inovio Bio, for gross cash proceeds to Inovio Bio of about $9.9 million.

The share price of the Inovio Bio stock issued upon completion of the financing and issuable upon the exchange of the ordinary shares of Inovio Asia represents a premium of about 105% to the closing price of Inovio Bio’s stock on Sept. 15. The warrants issued in the financing by Inovio Bio, and the warrants issuable in the exchange by Inovio Bio are exercisable at $2.87 a share for five years.

Inovio Bio is focused on commercializing its proprietary Selective Electrochemical Tumor Ablation (SECTA) therapy and its delivery platform for gene-based treatments. SECTA is designed to provide a local treatment for solid tumors, with selective killing of cancer cells while preserving surrounding tissue. Inovio said it is moving its lead product, the MedPulser, through premarketing studies for head and neck cancer and skin cancers in Europe, where it is CE marked, a U.S. Phase III pivotal study for head and neck cancer, and a Phase I trial for breast cancer.

In other financing activity:

• Innovative Biosensors (IBI; College Park, Maryland), developer of pathogen tests, reported expanding its A round to $6.25 million with additional investors, including Chart Venture Partners and CNF Investments, an affiliate of Clark Enterprises.

In May, IBI closed its A financing, led by Harbert Venture Partners, the New Markets Growth Fund and the Maryland Venture Fund.

IBI said it will use the added financing for development of human clinical assays and commercialization of biodefense testing products.

Joseph Del Guercio of CNF Investments and Cole Van Nice of Chart Venture Partners have been added to the company’s board.

Joe Hernandez, IBI’s president/CEO, said that the new funding “will hasten the availability of rapid tests to markets that desperately need quick, accurate results to assist with critical, time-sensitive decision-making.”

• Logical Images (Rochester, New York) reported closing a $2.7 million financing with Ticonderoga Capital, an equity firm focused on healthcare information technology.

Logical Images said it will use the funding for product development, sales force expansion and entrance to new markets. James Vandervelden, a partner at Ticonderoga, has joined Logical Images’ board.

Vandervelden said that Logical Images “has a valuable visual clinical decision support tool, a strong management team and ... a customer base which includes over 350 hospitals in the U.S. and 10 other countries, along with the U.S. military and several state and local health departments.”

Logical Images develops products to speed visual recognition and clinical decision making.